$256M loan for Tappan Zee Bridge is OK'd

Foe calls it raid on funds for other projects

ALBANY — The Public Authorities Control Board approved a controversial $256 million no-interest loan toward the cost of the new Tappan Zee Bridge from a revolving loan fund for local water and sewer projects Wednesday.

ALBANY — The Public Authorities Control Board approved a controversial $256 million no-interest loan toward the cost of the new Tappan Zee Bridge from a revolving loan fund for local water and sewer projects Wednesday.

The good government, environmental and transportation advocacy organizations that have sought to block the loan immediately asked the Authorities Budget Office to investigate the Environmental Facilities Corp. for potential violations of its statutory duties. The EFC, chaired by Gov. Andrew Cuomo's environmental conservation commissioner, administers the revolving loan fund.

"A raid is a raid, and public money should not be bandied about behind closed doors without proper public scrutiny and oversight," said Peter Iwanowicz, executive director of Environmental Associates of New York.

Members of the control board, which is charged with overseeing project-related financing for state authorities, questioned EFC and New York State Thruway Authority representatives for almost an hour but the requisite unanimous vote was never in doubt. Its three voting members are Robert Megna, Cuomo's budget director and chairman, and representatives of the Senate and Assembly majority leaders.

"These (environmental) things have to be done," said Sen. John DeFrancisco, a Republican from Syracuse. "They didn't make them up to grab some money."

Last month, DeFrancisco had suggested he would oppose the loan if he couldn't get the Thruway Authority to spell out exactly how it will pay for the $3.9 billion bridge — namely the timing and size of future toll increases. The Thruway is the major highway in his district.

The best he did was to get Thomas Madison, the Thruway Authority's executive director, to say that, yes, there will be future toll increases to pay for the new bridge as well as other projects along the 570-mile highway.

The Thruway Authority's 2014 budget projects toll revenues will have to rise to $952.5 million in 2017 from $647.5 million this year to cover its operating and capital expenses, including the repayment of debt.

But the senator said Wednesday that he was satisfied, as a result of pre-meeting briefings, that the federal Clean Water Act permitted loans for protecting water quality and marine life in estuaries such as the Hudson River.

The remaining $256 million that the Thruway Authority wants from the EFC will be addressed in 2016, when additional environmental mitigation projects are completed. The loans are paid out as reimbursements.

The advocacy organizations have argued the loan is an improper diversion of Clean Water Act funds and a precedent of potentially national significance.

State legislators, water quality professionals, Westchester County mayors and supervisors, and a New York City councilman have also expressed alarm, pointing out municipalities will need to invest $36 billion in wastewater treatment over the next two decades. And they have complained that Cuomo's tax cap has prevented many cities and towns from applying for EFC loans.

But Matthew Driscoll, president and CEO of the EFC, said Wednesday that the corporation only considered the Thruway Authority's application after it had met all this year's requests for funding and still had about $750 million to roll over into next year.

Driscoll said the Thruway Authority loan doesn't set a precedent as much as it makes use of an "underutilized" section of the Clean Water Act and insisted the EFC didn't need the U.S. Environmental Protection Agency's permission to grant it. He acknowledged, however, that the EPA, which is reviewing the loan's propriety, could ultimately deny it.